free
Get a
CPT consultation today
15 min
Alisa Zueva,
Accountant at EFIX GRP
Accountant at EFIX GRP
Get a free
CPT consultation today
100%
financial
responsibility
200+
successfully
filed reports
65+
long-term
clients
4+
years on the UAE
market
Suleimanov Murtuz,
CEO at EFIX GRP
CEO at EFIX GRP
What is VAT in the UAE?
VAT (Value Added Tax) is an indirect tax on the consumption
of goods and services. It was introduced in the UAE
on January 1, 2018, at a standard rate of 5%. Businesses collect VAT on behalf of the government and file returns with the Federal Tax Authority (FTA).
of goods and services. It was introduced in the UAE
on January 1, 2018, at a standard rate of 5%. Businesses collect VAT on behalf of the government and file returns with the Federal Tax Authority (FTA).
- Trade License
- Passport & Emirates ID
- Bank letter / IBAN confirmation
- Proof of income (invoices, contracts)
- Lease agreement
- Last 12 months revenue breakdown (mandatory for VAT registration in UAE)
Checklist for VAT Registration
Documents
VAT Registration Requirements in the UAE?
Businesses must register for VAT if:
Source:
Federal Tax Authority UAE — VAT Registration Guide
Voluntary registration is allowed from AED 187,500 for the last 12 calendar months
They import goods or provide digital services (including
e-commerce)
They make taxable supplies in the UAE (goods or services)
Their annual taxable turnover for the last 12 calendar months exceeds AED 375,000 (mandatory registration threshold)
Checklist for VAT Registration
Documents
- Trade License
- Passport & Emirates ID
- Bank letter / IBAN confirmation
- Proof of income (invoices, contracts)
- Lease agreement
- Last 12 months revenue breakdown (mandatory for VAT registration in UAE)
1.0
Create an account
on the FTA EmaraTax portal
on the FTA EmaraTax portal
license, passport copy, IBAN letter
Upload required documents
3.0
2.0
Fill in the VAT registration form
Receive your TRN (Tax Registration Number) within 1–3 business days
5.0
4.0
Submit the application
How to Register for VAT
Late registration may result
in a 10,000 AED penalty
EFIX GRP offers VAT registration
in UAE for AED 800
Including document review and TRN submission through EmaraTax
VAT Rates & Thresholds
These UAE VAT rates are defined by the FTA and apply to all Mainland and Free Zone businesses unless exempt
Rate / Limit
Category
AED 375,000
for the last 12 calendar months
Mandatory registration
No VAT
e.g. residential rent, local transport
Exempt supplies
0%
e.g. exports, healthcare, education
Zero-rated supplies
5%
Standard VAT Rate
AED 187,500
375 for the last 12 calendar months
Voluntary registration
These UAE VAT rates are defined by the FTA and apply to all Mainland and Free Zone businesses unless exempt
VAT Rates & Thresholds
Businesses must register for VAT if:
Rate / Limit
Category
5%
e.g. exports, healthcare, education
0%
e.g. residential rent, local transport
No VAT
annual taxable turnover
AED 375,000
annual turnover
AED 187,500
Exempt supplies
Voluntary registration
Mandatory registration
Zero-rated supplies
Standard VAT Rate
Returns must include:
- taxable sales
- purchases and expenses
- input VAT and output VAT
- adjustments (if applicable)
Returns must be submitted within 28 days after the end of the tax period
VAT returns are filed quarterly, unless otherwise assigned by the FTA
VAT Return Filing
VAT return filing in UAE is included
of charge for EFIX GRP accounting clients
free
15 min
Speak With Tax consultant
Nana Zhorzholiani,
Accountant at EFIX GRP
What Our Clients Say
Below are verified Google Reviews from UAE businesses that completed VAT registration and compliance services with EFIX GRP
4.8
20 reviews
О Б
Напишу отзыв , чтобы рассказать об этих замечательных профессионалах, прожив 5 лет в Дубае...
Karina Ekizyan
Пользуемся услугами этой компании и очень довольны. Ребята всегда на связи, помогают по...
Natalya Zulfugarova
Работаем с EFIX уже не первый период и, честно, это тот редкий случай, когда за...
Artur
Я фрилансер и работаю с этой бухгалтерской командой уже более двух лет...
Ольга Пинчук
Обслуживаюсь у Эфикс групп уже больше 3х лет. Я в восторге от профессионализма ребят...
5% of unpaid VAT
Late payment
AED 2,000/month
Failure to file return
Up to AED 50,000
False declarations
AED 1,000–2,000
Late filing
AED 10,000
Late registration
FTA Penalties
Source:
Some goods and services in the UAE are classified as VAT-exempt, meaning they are not subject to VAT at any stage of the transaction, and the supplier cannot charge VAT or reclaim input VAT on related expenses
Who Is Exempt from VAT in the UAE?
Residential property rentals
non-commercial use
Businesses providing only exempt supplies are not required to charge VAT, and cannot recover VAT paid on purchases related to these activities
if not licensed or qualified under zero-rating rules
Some educational services
Sale of residential buildings after the first 3 years of completion
Local supply of donated goods by charitable entities
e.g. issuing loans, credit card fees, life insurance
Certain financial services
Local passenger transport
e.g. metro, buses, taxis
Bare land sales and leases
Common VAT-exempt categories include
VAT for Free Zones & Designated Zones
Many businesses assume that Free Zones are VAT-free — this is a common misunderstanding
Ajman Free Zone
DSO (Dubai Silicon Oasis)
Al Hamriyah DZ
KIZAD
RAKEZ
Meydan FZ
IFZA
DMCC
DWC (Dubai South)
Ajman Free Zone
DSO (Dubai Silicon Oasis)
Al Hamriyah DZ
KIZAD
RAKEZ
Meydan FZ
IFZA
DMCC
DWC (Dubai South)
Ajman Free Zone
DSO (Dubai Silicon Oasis)
Al Hamriyah DZ
KIZAD
RAKEZ
Meydan FZ
IFZA
DMCC
DWC (Dubai South)
EFIX GRP helps Free Zone businesses evaluate their VAT requirements, handle registration, and ensure full compliance with FTA regulations
Designated Zones are specific Free Zones treated as outside UAE VAT territory for certain transactions
However, most Free Zone companies must still register for VAT once they reach the AED 375,000 threshold
Related Services by EFIX GRP
HR & Payroll
Administration
Corporate Tax
Registration & Compliance
Registration & Compliance
Accounting
& Bookkeeping Services
Company
Formation Services
4.0
Await FTA
Review & Approval
Review & Approval
3.0
Submit Final VAT
Return & Settle Liabilities
Return & Settle Liabilities
2.0
Submit De-registration Application via EmaraTax
1.0
Assess Eligibility
VAT De-registration in the UAE
It is required when a company no longer meets the VAT criteria
Steps:
When to de-register:
Turnover falls below
AED 187,500
You permanently close or stop taxable activity
No longer making taxable supplies
- Turnover falls below AED 187,500
- No longer making taxable supplies
- You permanently close or stop taxable activity
EFIX GRP ensures a clean
and penalty-free de-registration
and penalty-free de-registration
Let’s say your company made sales worth AED 50,000 this month.
You also had business expenses (like rent, internet, or software)
where you paid AED 1,000 in VAT.
Simple VAT Calculation Example
How it works:
VAT on your sales
(5% of 50,000)
AED 2,500
VAT you already paid on expenses (input VAT)
AED 1,000
VAT you owe to FTA: 2,500 – 1,000
AED 1,500
The AED 375,000 threshold only determines whether VAT registration is mandatory.
Once you are registered — you must charge 5% VAT on all taxable sales, even if your monthly or yearly turnover is below that amount.
Updated:
December 2025 — verified by EFIX GRP
Why сhoose EFIX GRP
10+ years in accounting
Our team has over a decade of experience in accounting and tax compliance, and the majority of our specialists come from Big 4 firms.
Transparent pricing
Our pricing is clear and agreed upfront — no hidden fees or unexpected charges. You always know the scope of work and total cost before we begin.
Team-based approach
You work with a structured team, not just one individual specialist. If someone is on leave or unavailable, continuity of service is maintained without disruption.
Financial responsibility
We take responsibility for the quality of our work. In the event of an error on our side, we assume financial accountability in accordance with our agreement.
Prineeth Dinesh,
Accountant at EFIX GRP
Get a free consultation today
VAT FAQ – Frequently Asked Questions
No, VAT registration is only required if your taxable supplies within the UAE exceed AED 375,000 per year. If you only serve clients abroad and have no UAE-based revenue, registration is not mandatory.
Yes. If your annual turnover is above AED 187,500 but below the mandatory threshold, you may voluntarily register. This is useful for claiming input VAT or enhancing your company’s credibility.
You are still required to file VAT returns, even with zero revenue. Failing to file can lead to penalties.
If the business is no longer active, you may apply for de-registration.
VAT applies to both, but some Free Zone structures may benefit from special rules. However, most Free Zone companies must still register and file returns if they exceed the threshold or sell to mainland.
VAT applies to both, but some Free Zone structures may benefit from special rules. However, most Free Zone companies must still register and file returns if they exceed the threshold or sell to mainland.
The FTA charges penalties for late filing or non-compliance, starting from AED 1,000 - 2,000. Repeated violations lead to higher fines. EFIX helps ensure all your reports are submitted on time.
When is VAT de-registration required?
If taxable turnover over the last 12 months falls below the AED 375,000 threshold or the company ceases operations, an application for de-registration must be submitted through the FTA portal along with the final VAT return.
A VAT Health Check is a review of VAT compliance, including analysis of filed returns, transaction classification, and reconciliation with financial statements to identify potential risks before an FTA review.
Yes. A Reconsideration Request can be submitted within the prescribed timeframe, supported by proper justification and documentation. In certain cases, penalties may be reduced or cancelled.
